Good morning, and welcome to the Principal Financial Group First Quarter 2022 Financial Results Conference Call. There will be a question-and-answer period after the speakers have completed their prepared remarks. If you would like to ask a question at that time, simply press star and then the number one on your telephone keypad. We would ask that you be respectful of others and limit your questions to one and a follow-up so we can get to everyone in the queue. I would now like to turn the conference call over to Humphrey Lee, Vice President of Investor Relations. Thank you and good morning. Welcome to Principal Financial Group's first quarter 2022 conference call. As always, materials related to today's call are available on our website at investors.principal.com. Following a reading of the safe harbor provision, CEO Dan Houston and CFO Deanna Strable will deliver some prepared remarks. We will open the call for questions. Other available for the Q&A session include Chris Littlefield, Retirement and Income Solutions, Pat Halter, Global Asset Management, and Amy Friedrich, U.S. Insurance Solutions. Some of the comments made during this conference call may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act. The company does not revise or update them to reflect new information, subsequent events, or changes in strategy. Risks and uncertainties that could cause actual results to differ materially from those expressed or implied are discussed in the company's most recent annual report on Form 10-K filed by the company with the U.S. Securities and Exchange Commission. Additionally, some of the comments made during this conference call may refer to non-GAAP financial measures. Reconciliation of the non-GAAP financial measures to the most directly comparable U.S. GAAP financial measures may be found in our earnings release, financial supplements, and slide presentation. Dan. Thanks, Humphrey, and welcome to everyone on the call. This morning, I will share the progress we're making against our financial targets and touch on key performance highlights for the quarter. Deanna will follow with additional detail around our first quarter results, as well as our current financial and capital position. Before we dive in, I have a few important business updates to share. We continue to work towards a second quarter close of the transactions to reinsure our U.S. retail fixed annuities and ULSG blocks. As shared previously, we expect approximately $800 million of deployable proceeds upon closing and through additional capital management actions. In China, CCB Pension Management, a subsidiary of China Construction Bank, recently announced they are in the final stages of seeking regulatory approval for Principal to acquire a minority stake of more than 17% in the pension company. CCB is the second largest bank in the world, and we've had a strong relationship with them for over 17 years through our asset management joint venture. We look forward to receiving final approval and expanding our relationship to leverage our global retirement and asset management expertise through our partnership. We plan to share more details once the transaction closes. Lastly, the integration of the institutional retirement and trust business is now complete as the final piece, the trust and custody business, successfully migrated to Principal during the first quarter. The IRT acquisition added scale and elevated our position to a top retirement provider, including number three provider of defined contribution plans based on the number of participants and the number one position for defined benefit, non-qualified deferred compensation, and ESOP based on the number of plans. It gave us new capabilities, including an industry-leading depth and breadth of retirement offerings through total retirement solutions. It's providing new revenue opportunities, including IRA rollovers, managed accounts, and proprietary asset management. As a result of the acquisition, we've benefited from growth in the sales pipeline driven by our new consultant relationships. Turning to our financial highlights on slide four, amid market volatility, ongoing impacts from the pandemic and geopolitical events and uncertainties, our first quarter results highlight the focus, strength, and resiliency of our diversified business strategy. In the first quarter, we reported $429 million of non-GAAP earnings or $1.63 per diluted share. Excluding significant variances, earnings increased 8% over the first quarter of 2021. We continue to deliver on our strengthened capital deployment strategy to return excess capital to shareholders. In the first quarter, we returned nearly $900 million through share repurchases and common stock dividends. We closed the first quarter with $714 billion of total company AUM, a 7% increase over the first quarter of 2021. Now turning to our business highlights. Focused execution on our growth drivers of retirement, asset management, and benefits and protection continue to fuel growth across the businesses. In U.S. Insurance Solutions, we delivered tremendous growth in the first quarter after a strong 2021. The demand for benefits, robust hiring, and favorable wage trends continue to increase across our target market of small to medium-sized businesses. Specialty benefits premium and fees increased 10% compared to the first quarter of 2021, driven by record sales, strong retention, and employment growth. Trailing twelve-month employment growth was a record 4.7% for the total block. In individual life, our focus on business market is resonating with distributors as we produced record non-qualified COLI sales and robust business owner sales. Over 50% of the COLI sales were part of a total retirement solution plan with RIS. Highlighting the opportunity to build long-term multiproduct relationships with customers through integrated solutions. Our pipeline of new business continues to grow as employers focus on benefits as one effective strategy to help them attract as well as retain talent. In our U.S. retirement business, RIS fee recurring deposits were strong and increased nearly 60% compared to a year-ago quarter. This includes a 17% increase in our legacy block in addition to deposits from the IRT retirement participants. As the economic recovery continues, participants are saving more for retirement. Compared to a year ago, the average dollars of deferrals per participant has increased 5%, and the average dollars of employer match per participant has increased 6%, both of which are fueling growth in recurring deposits. Additionally, the number of participants deferring across the block has increased more than 2.2 million over the same period, reflecting the full integration of the IRT retirement participants. The increase in deposits, strong sales and retention, as well as a benefit from fewer dollars of withdrawals due to lower equity market performance, drove $3 billion of positive account value net cash flow in the first quarter for RIS fee. In global asset management, PGI managed AUM of $537 billion benefited from positive net cash flow and the addition of certain migrated IRT trust and custody assets. This was mostly offset by macroeconomic market conditions, which negatively impacted equity and fixed income markets during the quarter. PGI delivered more than $3 billion of positive net cash flow across both institutional and retail platforms, driven by our differentiated solutions within real estate, specialized income capabilities, and alpha performing equity strategies. Turning to investment performance on slide six, market volatility combined with a rotation from quality and growth to value investing impacted our short-term investment performance during the quarter. Our longer-term investment performance, as well as real estate returns, positions us to drive positive net cash flow and to attract and retain the assets going forward. Outside the U.S., our focus remains on growing our diversified fee-based revenue across our asset management and retirement business amid near-term macro and regulatory headwinds. Reported AUM for Principal International was $164 billion at the end of the quarter, driven by favorable foreign currency movements since the beginning of the year. AUM in China, which is not included in our reported AUM, grew by 10% from the end of the year to $193 billion, with strong growth coming from retail clients. Before I turn it over to Deanna, I want to highlight a notable recognition we recently received. Pensions & Investments once again included Principal on its list of best places to work in money management. We're proud to be one of only five companies that have been included every year in the awards ten-year history. This is just one example of how our employees and leaders continue to build a culture that makes people proud to work at Principal and deliver every day for our customers. Deanna? Thanks, Dan. Good morning to everyone on the call. This morning I'll share the key contributors to our financial performance for the quarter, as well as an update on our current financial and capital position. Our transformation into a higher growth, higher return, more capital efficient company focused on our growth drivers is paying off. As of the first quarter and excluding significant variances, non-GAAP EPS increased 13% over the year ago quarter, and ROE improved 50 basis points from the end of the year to 14.5% and is well on the way to 15%. Net income attributable to Principal was $376 million in the first quarter, including $53 million of net realized capital losses with $20 million of credit losses. Excluding significant variances, first quarter non-GAAP operating earnings of $478 million or $1.81 per diluted share increased 8% and 13% respectively compared to the first quarter of 2021. The non-GAAP operating earnings effective tax rate was approximately 15% on a reported basis and 16% excluding significant variances. For the full year, we continue to expect to be within the 17%-20% guided range. As detailed on slide 14, we had several significant variances that had a net negative impact on non-GAAP operating earnings during the first quarter. Benefits from favorable variable investment income and inflation in Latin America were more than offset by COVID-related claims, lower than expected encaje performance, higher DAC amortization, and the final IRT integration cost. These had a net negative impact to reported non-GAAP operating earnings of $63 million pre-tax, $49 million after-tax, and approximately 19 cents per diluted share. Specific to variable investment income, RIS-Spread, Principal International, and Individual Life benefited by a combined $47 million pre-tax, primarily due to higher than expected alternative investment returns. This was partially offset by a negative $32 million dollar impact in corporate as the increase in interest rates and decline in equity investments negatively impacted some mark-to-market investments. COVID continues to impact results in RIS-Spread in U.S. Insurance Solutions. With approximately 153,000 U.S. COVID-related deaths in the quarter, the net $30 million dollar after-tax impact was at the higher end of our rule of thumb. Looking at macroeconomic factors in the quarter, the S&P 500 index decreased 5% and the daily average decreased 3% compared to the fourth quarter. This negatively impacted fee revenue compared to the fourth quarter, as well as DAC amortization in RIS fee. The daily average increased 16% from the year ago quarter, benefiting revenue, AUM, and account values in RIS fee and PGI. Foreign exchange rates were a tailwind compared to the fourth quarter and on a trailing twelve-month basis, but a headwind relative to the year ago quarter. Impacts to reported pre-tax operating earnings included a positive $3 million compared to fourth quarter 2021, a negative $4 million compared to first quarter 2021, and a positive $11 million on a trailing twelve-month basis. In RIS-Spread, pre-tax operating earnings were a record on a reported basis as strong net investment income, favorable experience gains, and growth in the business boosted results. Relative to the fourth quarter, PGI's margin and pre-tax operating earnings were pressured by expected expense seasonality and lower fee revenue, including a 4% decline in management fees, as well as lower performance fees, which can be volatile quarter to quarter. As we discussed on the outlook call, results in Principal International are being pressured by regulatory fee reductions in Mexico that went into effect at the beginning of the year. First quarter earnings were negatively impacted by approximately $10 million as a result of the reduction. We acknowledge there are headwinds in Mexico, and we're taking action to offset a portion of this impact in the near term through expense management. It's important to remember that the mandatory contributions in Mexico are scheduled to increase annually from 6.5% today to 15% in 2030, more than doubling retirement savings. This will provide financial security for our customers and long-term growth for Principal. Specialty benefits had a strong start to the year with a 60% first quarter loss ratio excluding COVID claims and a 10% increase in premium and fees over the first quarter of 2021. As Dan mentioned, we continue to work toward a second quarter close of the reinsurance transactions, and our expectations around the financial impacts haven't changed from what we shared on the outlook call. As a reminder, we'll have a year-to-date true up that will transfer all of the associated revenue and earnings as of the beginning of the year. Turning to capital and liquidity, we remain in a strong financial position and are focused on returning excess capital to shareholders. At the end of the first quarter, we had $1.7 billion of excess and available capital, including $1.4 billion at the holding company, higher than our $800 million to cover 12 months of obligations, and approximately $325 million in our subsidiaries. Our estimated risk-based capital ratio was 400% at the end of the quarter, in line with our target. We will continue to maintain a 20%-25% leverage ratio and expect the ratio to improve once the transaction closes and as we pay down $300 million of long-term debt set to mature later this year. As shown on slide five, we are well on our way to returning our targeted $2.5-$3 billion of capital to shareholders in 2022, including $2-$2.3 billion of share repurchases. We returned nearly $900 million of capital to our shareholders in the first quarter, with $167 million of common stock dividends and $724 million through share repurchases. $560 million of share repurchases was through a $700 million accelerated share repurchase program, the balance of which will be completed in the second quarter. Last night, we announced a $0.64 common stock dividend payable in the second quarter, a 5% increase from the dividend paid in the second quarter of 2021. This is in line with our targeted 40% dividend payout ratio and reflects strong business performance. As we move forward executing on our go-forward strategy and strengthened capital deployment approach, we will continue to invest in our growth drivers of retirement in the U.S. and select emerging markets, global asset management, and U.S. benefits and protection, all with an aim to drive long-term shareholder value. This concludes our prepared remarks. Operator, please open up the call for questions. Thank you. At this time, I would like to remind everyone that to ask a question, press Star and then the number one on your telephone keypad. We'll pause for just a moment to compile the Q&A roster. The first question comes from the line of John Barnidge with Piper Sandler. Your line is now open. Thank you very much. You've had strong growth in alternatives in PGI. Higher fee product seems to be in secular demand. Can you maybe talk about that? Does this make you want to create more product for that business as well? Thanks. Yeah. Good morning, John. Appreciate the question. You're right. Pat and his team have been deliberately shifting, and they've been doing it for years. It's obviously paying off here as we continue to see the market cycle. Pat, you want to provide some specific feedback on the alts? Yeah, John, thanks for the question. It really starts first with client interest, and we continue to see some very, very strong interest in alts, particularly real assets and in the private space. As you probably know, we are one of the largest real estate investment management organizations worldwide. We think there's a lot of runway yet in terms of not only in institutional space but also in the retirement space, and then ultimately as high net worth individuals continue to seek out new alternative investment strategies. I think we're gonna continue to absolutely grow in our real estate capabilities. We also have some very strong private credit capabilities, and we think that's a place that also has significant growth potential. We'll be continuing to build out our private credit capabilities going forward. Beyond that, we'll continue to seek out new capabilities that we think the marketplace desires. Things like hybrid debt, more private equity capabilities would be something that we'd like to sort of aspire to continue to also build out. We will lean in toward alternatives because client demand is increasing, and I think because we have strong capabilities in that arena, John. Fantastic. A follow-up. Strong movement in group sales across all products. Can you maybe talk about that, the health of the small business? Because I know that's a large portion of your consumer base, That's a great observation. Clearly, small business is open for business in the U.S. for sure. Amy, you want to provide some additional detail? Yeah. John, thanks for the question. Yeah. It's clear that the small business strategy is working. When we look at those small business dynamics, they are hiring, they're taking care of their key executives, and they're worried about competing with all size businesses in terms of what they do for their key executives and how they attract and retain talent. We're really seeing ourselves as the beneficiary of a competitive wage market, a competitive labor market. Probably even more importantly, this is the expression of really what's been years of a build for us at a local market. We have experienced folks who are well-seasoned and well developed relationships in our local market. What we're seeing is we have products that are attractive, underwriting that's disciplined, and growth that we see as very strong, which is gonna continue to be strong. There's macro conditions as well as our own brand and our own developments in technology and processes and relationships that are really paying off for us, and we see that continuing in 2022. This might be a good time to reintroduce Chris Littlefield to investors who's new to the role, replacing Renee Schaaf, although he's not new to the industry. He's formerly been CEO of two other publicly traded companies. I know he knows a number of the analysts on the call today. Obviously, in replacing Renee, he's got responsibility for our RIS fee and Spread business. Maybe Chris, to follow on John's comments with regards to the small to medium-sized business market, how are you seeing that for the retirement space? Yeah. Thank you, Dan. Hi, John. Good to talk to you again. You know, I think we see the same strength in the retirement space as well. I mean, we continue to see strong employment growth across all segments of our business and certainly see growth in small business. We see an uptick in adoption of plans as well as increases in matches across all segments. We really see the same strong employment tailwinds in the retirement side of our business as we see it in the group benefit side. Thanks, John, for the question. Thank you. Our next question comes from the line of Tom Gallagher with Evercore. Your line is now open. Good morning. Hey, Dan. I recognize you probably can't give specific comments on the China Construction Bank deal that you mentioned. Can you at least indicate whether you would expect that to consume a meaningful amount of your capital from a size standpoint? Would that potentially reduce the size of buybacks? It sounded to me like you were still planning on doing the buyback ranges that you had guided to for 2022. Yeah. Tom, appreciate the question. I'll have Deanna follow up here. But I just want to be on the record with this. Many of you have followed Principal for a very long time, and you have known that it has been our long-term desire to expand our relationship with CCB, and I remind investors it's the second largest bank in the world. We've had a relationship on asset management and the retail mutual fund business since 2005. It's a very healthy relationship. You heard in my prepared comments that we are buying a minority interest in what is already a well-established retirement company. What makes them a little bit unique, Tom, is they have pillars one, two, and three, so it allows them to manage money for the national and provincial retirement savings pools, as well as the enterprise annuity, which has probably been the most common conversation with investors in the past. Then lastly, pillar three is around private retirement funds of funds. This is just a terrific win for Principal. We're very excited, and I'll have Deanna sort of finish up with some additional details around the transaction. Yeah, Tom. Just as a follow-up there, this was factored into our 2022 capital deployment plans. If you remember back to Outlook Call, there was a waterfall chart there that showed kind of beginning of the year to the end of the year, and there was a placeholder in there for M&A and/or additional share buyback. That would've been included in that, and thus does not have any impact on what we've talked about regarding return to shareholders in the year 2022. We will obviously give more financial details, capital earnings implications of that transaction once it's disclosed. As Dan said, we're very excited about the opportunity and the prospects going forward. Okay, that helps, Tom. That does. Thanks, Dan, Deanna. Just my follow-up is, Deanna, can you comment on the sequential decline in expenses at PGI that you would expect into 2Q? I know seasonally Q1 is on the high side. Just want a get a sense if you could give kind of a dollar range. I was thinking maybe $10 million-$15 million reduction seem reasonable given what's happened historically, but if you could provide any color on that. Yeah. I think at a high level, you're in the right ballpark, but I'll see if Pat has anything else, to add on to that. Yeah. Tom, I think what you're referring to is sort of this every first quarter of the year, we have this sort of a true up in terms of expenses relative to long-term compensation and payroll taxes. That does have an increase in the first quarter expense structure for PGI. It's probably gonna be more around $15 million in terms of what that expense is, and you should not expect to see that expense in the second quarter. That's great. Thanks, Pat. Thanks, Tom. All right. Our next question comes from the line of Ryan Krueger with KBW. Your line is now open. Hi. Thanks. Good morning. Could you within PGI discuss how the rise in interest rate environment is or could affect demand for your product and your flow outlook going forward? Pat, any insights? Yeah, Ryan. I think, one of the things that's, great, I think about, our suite of investment capabilities, we have some very strong income producing investment capabilities. The actual, sort of rise in interest rates are starting to create some very interesting absolute returns, again in fixed income. We're starting to see, again, some pivot more towards interesting conversation around the absolute returns at things like emerging market debt, preferreds, high yield, sort of debt is producing in terms of absolute returns. That's one sort of aspect of it. Clearly within our existing block, because we do have a total return sort of portfolio of fixed income, the rise in interest rates has created a say somewhat of a headwind in terms of mark-to-market on our existing block in terms of AUM. From a client perspective, we're seeing some very interesting, I think, eyeballs again on fixed income in terms of allocations. Got it. Thanks. Deanna, do you have preliminary estimate on what the true up impacts would be in the second quarter after the reinsurance transaction closes? Yeah, Ryan. Just as a reminder, and you're correct, there will be a true up in the quarter that the transaction closes to transfer those economics to the counterparty. I don't have the estimate in the first quarter, but we will be transparent regarding the impact. I would say it's still in alignment of what we talked about at the outlook call regarding those pieces that will impact earnings in the year. If you remember, that was a total of about $130 million of after-tax impact, including the earnings from those blocks, stranded costs, as well as lost revenue in PGI. But regarding the first quarter true up, we'll make sure you have that once those transactions close. Thanks, Ryan. Thank you. Our next question comes from the line of Erik Bass with Autonomous. Your line is now open. Hi. Thank you. Maybe start with a follow-up on Ryan's question on PGI net flows. I was just hoping you could provide some more color on the trends in the first quarter, and sort of the dynamics between retail and institutional. With markets continuing to sell off in the second quarter, are you seeing any changes in demand or the institutional pipeline? Is it taking longer for anything to fund? Pat, please. Yeah, Erik, thanks for the question. We had, I think, a very across the board strong net cash flow in the first quarter, both in some of the income-oriented investments that I highlighted earlier, along with real estate that we discussed a little bit earlier, along with some alpha generating equity strategies. We're continuing to see that strong demand in the second quarter, Ryan, and it's actually in those three areas again. We're continuing to see some very strong institutional demand, particularly in real estate and in the high alpha generation equity capabilities. In terms of retail, the continuation of the storyline toward higher yields and strong alpha equity capabilities continues, and we continue to see flows there. I'm quite constructive on the second quarter yet in terms of the continuation of what we're seeing from the first quarter. Great. Thank you. One question I just noticed in the slide deck, I think your sensitivity now to a change in 100 basis points of interest rates is 1%-2% of earnings. I think it had historically been less than 1%. Just was curious why this has increased, especially since you're exiting ULSG and fixed annuities, which I thought would have been more rate sensitive pieces of your business. Deanna? Yeah. So we did update that at the outlook call and did reflect kind of the go forward kind of prospect there. I think we have a better understanding of the impact on some of the fee levels within PGI and RIS that we've reflected in there, just given the fact that a portion of that AUM is fixed income. Again, I think it's still modest, probably relative to most of our insurance peers. It's positive on a long-term basis, but can have some short-term pressures just given the impact on AUM. That was under the category of a refresh as we looked at prior experiences and what that looked like. I think it's on our end, a large part of a refinement, Erik. Got it. Just where would the biggest benefits come through by business line? Yeah. You know, ultimately, you're gonna see it in a number of places. Again, it can take some time to emerge. Obviously, net investment income, you'll see benefits from. Obviously, that would be primarily in spread and the insurance businesses. You'll have some impact ultimately on our pension cost, which actually gets spread across all of our businesses. Claim reserves and capital backing our insurance businesses would benefit as well. You know, again, primarily the benefits would be in more of the annuity and insurance businesses. Got it. Thank you. Thank you, Erik. Appreciate it. Our next question comes from the line of Tracy Benguigui with Barclays. Your line is now open. Thank you. Good morning. I'm wondering if you could shed some color on your view of favorable non-COVID-19 group life claims that you saw in specialty benefits? Yeah. Absolutely. Amy can handle that. Yeah. Tracy, one of the things that to keep in mind about our block of group life is that our block of group life is gonna be primarily underwritten for small cases. The plan designs are gonna be designed around those small cases. When we're looking at small case, they're going to have the ability to have the rate kind of line up with the experience that we're seeing on them more frequently than some of the other folks who are writing in that large case marketplace. We have the ability to kind of get that rate and claims lined up pretty closely together. What we are seeing in that block of business, though, is that our average claim size is probably gonna be smaller than some of our peer competitors just from the plan designs we're writing in that space. We're seeing what I would consider sort of normal positive volatility on that non-COVID group life block. Again, Principal's group life block is probably gonna have some characteristics to it that could behave differently than the rest of the industry. Follow-up, Tracy? Yeah, no. That's very helpful. Yeah, maybe sticking with specialty benefits, if you could also touch on the increase in your individual disability loss ratio, if I should read into that in any way. Thanks, Tracy. Yeah. I would not read into that in any way. I would look at the things that happen within individual disability. As you know, one or two claims can move some things around. Ultimately, it's a combination of new claims, kind of the incidence of those as well as the termination. I'm seeing what I would consider regular and appropriate patterns for our block of business on the new claims we're putting on, as well as the termination on rates on those. I'm not seeing anything COVID or non-COVID that looks out of pattern. That was very clear. Thank you. Appreciate it, Tracy. Thank you. Thank you. Our next question comes from the line of Suneet Kamath with Jefferies. Your line is now open. Great. Thank you. Just curious on RIS spread. I think, Deanna, in your comments, you mentioned it was a record result, even on a normalized basis, the results came in much better than your guidance. Could you just unpack that? I think you mentioned a couple things, but if you could give us any specificity on what drove it, that would be helpful. Yeah. I'll make some comments and then see if Chris wants to add in as well. You know, do keep in mind, Suneet, that the current quarter results do include retail fixed annuities, so that will be adjusted out once the transaction closes. We also saw some positive volatility and experience gains. Those, again, tend to be stronger in the first part of the year and then normalize out for the rest of the year. But I would probably still point you back to our outlook ranges for the full year and really focus on those post-transaction ranges for both revenue growth and margin. But again, first quarter was a really strong start to the year, and some of that trends I think will continue. Some we'll see volatility quarter to quarter. Chris, anything to add? No, I think she covered it well. Thank you. Excellent. Okay. I guess my follow-up is on Mexico. Obviously, you guys guided to the reduction in fees, but we're a little surprised to see that business produce a loss, and it looked like there was some volatility in NII. I guess wondering if you think that business can return to profitability. Relatedly, is that an area where you guys would think about inorganic growth? Yeah. Let me take it, and I'll throw it to Deanna as well. We'll tag team this a little bit. The first thing I'd say is we've been talking about this for some time, but in spite of the regulatory fee reductions that occurred earlier in the year, we do see a path forward for that business, in large part because the contributions are gonna start scaling up from 6.5% to 15% up until 2030. There is, you know, this is a significant pool of capital in Mexico. We think that the legislative and regulatory changes have been made, so we know what the operating model needs to be. We know that we've got a shortfall as it relates to revenue relative to the expenses. As Deanna has said in her prepared comments, we're in a position to take that expense out and get it in proper alignment. A good path. With that, I'll throw it to Deanna to talk to the numbers specifically. Yeah, just one comment there that you may not be aware of, but Mexico did have a hit from encaje in the quarter. That would've been in the magnitude of $4 million-$5 million. Absent that, earnings would've been slightly positive in the quarter. I just wanted to make sure that you understood. I don't think we explicitly split out the significant variances by country, but that was the impact in Mexico. Inorganic growth there, is that still on the table, or is that something you'd be interested in? You know, right now we're focusing on growth in an organic way. We're looking very closely at all the options, and we think there are things we could do from a distribution perspective. There are some things we can do to manage our expenses, but we don't see that the path forward in Mexico would involve a large acquisition, let's say, in order to change our long-term view of the Mexico market. Does that help, Suneet? Yep. Yeah, that's pretty clear. Thank you, Dan. Thank you. Our next question comes from the line of Jimmy Bhullar with JPMorgan. Your line is now open. Hi. Good morning. First, I had a question on just PGI investment performance. If we look at one-year numbers, they seem weaker than three-year, five-year or longer term. Wondering if you could just comment on what's causing that. Like, is it market driven, some of the big asset classes you're in are out of style, or what's going on there, and how does this affect your views on your flows over the next year or two? Yeah, Jimmy, appreciate the question. I'm reminded of the old adage, you're only good as your most recent quarter. As we know, PGI has put a lot of very solid quarters back to back for many years. You're right, the one-year performance is soft, and I know Pat and his team have been interrogating those, the rationale and why we find ourselves in a position today. Pat, please. Yeah. Jimmy, thanks for the question. You know, I think one of the things that just to highlight is, there has been a fairly significant shift over the last, couple of quarters, relative to investors and how performance has behaved relative to our style of investing, versus what the marketplace is providing. We have a very, biased sort of approach on the equity side to, growth and to quality. Value really has definitely outperformed growth in the marketplace, and quality has not, served well in the marketplace in the last, few quarters. Some of the sort of sectors that have been very much driving, I think, some of the returns in the value space, energy and commodities, which have been big winners, that's not where we spend a lot of our, I think, focus in terms of quality and growth. There has been, I think, a factor tilt that has caused the one-year numbers to be as they are. That being said, as I mentioned earlier in my earlier responses, investors continue to look at our three and five-year numbers in terms of their decision making. We continue to see in some of our really strong alpha producing capabilities, really in small cap, U.S. small cap and midcap, and actually in large cap, large cap in terms of our capabilities with Aligned and Blue Chip. We're continuing to see very strong three and five-year numbers, and that's continuing to attract capital to us in terms of sales activity and retention. We'll continue to be very focused on obviously navigating short-term performance. We still have, I think, a very strong long-term investment, sort of alpha generation platform here. We have confidence that that will endear itself as we go forward. Okay. Then on your retirement business, I think when you initially took on the wealth block and the trust and custody assets, the income dropped because of lower interest rates. I think now you've changed the product a little bit, but how do you think about that business with the increase in rates that we've seen recently? Yeah, I start with the fact that I think they've, you know, it's nice to have the trust and custody business fully moved over along with the retirement business, and there's a clear path forward with a lot of momentum. I'll ask Chris to speak to your specific question, Jimmy. Yeah. Thanks, Jimmy. I think what you're referencing is our Bank Deposit Sweep program product. We have moved that over from a revenue share to on a Principal Bank, and we've seen that sweep deposits increase as we've clawed back a great deal of the revenue with that product. At the end of the quarter, we're sitting at about $2.4 billion of assets in the program. That was up a bit over the first quarter, and we continue to see opportunities to potentially grow that. We want to give it a little bit of time to evaluate the performance, how it behaves and the risk appetite and returns before we increase our exposure there. Overall, you know, we manage that now more as a net investment margin business, net interest margin business, and wouldn't expect to see big swings or big upsides or downsides as a result of that product. Jimmy, you know, we talked the last quarter that we were trying to make up for that roughly $70 million shortfall, and this structure is allowing us to recover some of that. Again, we like what we're able to navigate here to recover some of those revenues as originally projected to investors. Thank you. Thank you. Our last question is from Alex Scott with Goldman Sachs. Your line is now open. Hi. Thanks for taking the question. My first one is just on expense flexibility in light of you know the market correction that we've experienced here. Could you discuss your expense base and just how to think through what portion of it is more variable versus the portion that's fixed and how we should expect that to play out? Yeah. Appreciate the question, Alex. The one thing I just want to remind investors of is we have a long-standing history of aligning our revenue with, or aligning our expenses with revenues. We've gone through a lot of cycles over the years. Even as we divest businesses and acquire these businesses, we've always prioritized the alignment of those matters. It's a great question given the current volatility. Deanna, please. Yeah. Thanks, Alex. We can follow up with you to some of the specific splits on the expenses, but I kinda go back to what Dan talked about. You know, whenever you have a quick move in the markets, there can be some lag in our ability to adjust our expenses, but our management team is really focused on that. We have proven history of that. If I look at quarter-over-quarter, even with net revenue up in the 4%-6% range, our comp and other is only up less than 2%. If you go back to a trailing twelve-month basis when we saw 12%-14% increase in revenue, our comp and other is only up 9%. It is something we look at, we take very, very seriously. You might see some lag relative to that, but no doubt that we will continue to focus on adjusting the expense base, either through variable natural basis or other actions to make sure that we're producing margins that these businesses should produce. A follow-up, Alex? Yeah, maybe a quick unrelated follow-up. Just with the closing of the Wells Fargo IRT business, are there any sorta quarter-over-quarter considerations that we should think about heading into 2Q, just in light of, like, a full quarter of having it on board? I don't know if, like, TSAs and so forth go away or, I'm sure it's part of your outlook, but just wondering if there's anything, you know, as that is fully closed that we should think about. Yeah, I'll throw it to Deanna here in a second. What I would tell you is we've been doing it all along and peeling back those expenses as we've taken over more of the responsibility. What I can reaffirm is that we're very much on track with all the original projections that we had laid out with regards to expense synergies and revenue synergies. I talked a little bit about that in my prepared comments, but Deanna, anything to add? Yeah, I'll make a few comments and then see if Chris has anything to add. You know, the first thing is integration costs are now complete, so you're no longer having that come through from a significant variance perspective. Even though we have seen a ramp down of TSA and a start of the synergies, that will obviously ramp up now that it is all complete. You will see that flowing through both RIS fee fees expenses as well as total company, and you'll see some more of that as we go through the rest of the year. Chris, anything to add? No, I think you captured. I mean, we'll see the TSA run off mostly in the first quarter, and integration costs are complete. I mean, I think you'll see, and we said over the course of the year we would see margin improve if normal markets existed due to increased expense synergies from the acquisition. I think you'll see that through the back half of the year. Very good. Thanks, Chris. Thanks, Alex, for the question. Thank you. We have reached the end of our Q&A. Mr. Houston, your closing comments, please. Well, first, thank you for taking the time this morning, and we look forward to getting completion on the ULSG and the fixed retail fixed annuity transaction. We feel very good about where we're at with regards to return of capital to shareholders and again, right on track with where we're at. Probably equally as excited about the momentum we have on our go-forward strategy and executing on that consistently. We're gonna continue to invest in our growth businesses. We're gonna continue to invest in talent, and we're gonna take out expenses that don't add value. I'd also be remiss if I didn't say how fortunate we are to have Humphrey Lee join the team. It's been wonderful onboarding him these last 90 days. I know he's reached out to a lot of the sell side and will certainly work with the buy side. We want to make sure that the information we're providing to you is transparent, that it resonates, and we'll continue to look for opportunities to continue to improve our disclosures to investors. Frankly, we very much look forward to coming out and visiting with you in person in the very near future. Thank you, and have a wonderful day. Thank you for participating in today's conference call. This call will be available for replay beginning at approximately 1 P.M. Eastern Time until the end of the day, May 6, 2022. 1872237 is the access code for the replay. The number to dial for the replay is 855-859-2056 for U.S. and Canadian callers or 404-537-3406 for international callers. You may now disconnect.